Microsoft Corp - Gates - Case Study

Essay title: Microsoft Corp - Gates - Case Study

WASHINGTON (CNN/Money) - The government hammered away at Microsoft Corp. chairman Bill Gates in court Tuesday, attempting to portray him as an unreliable witness. And at one point Gates offered to alter his sworn testimony, landing a solid blow against Microsoft's position. The courts have found that Microsoft violated antitrust laws. The current hearings, under U.S. District Judge Colleen Kollar-Kotelly, will decide what restrictions will be imposed on Microsoft as a remedy for that illegal behavior. Gates has repeatedly complained that the remedies under consideration would be technically impossible to comply with or would force Microsoft to withdraw its Windows operating system from the market and force widespread layoffs at the company. The Department of Justice and half of the states involved in the original antitrust case reached a settlement with Microsoft in November. But nine states -- California, Connecticut, Florida, Iowa, Kansas, Massachusetts, Minnesota, Utah and West Virginia, along with the District of Columbia -- broke with the Justice Department's remedy proposal, arguing that it wasn't strong enough. Judge Kollar-Kotelly will decide what sort of remedies are appropriate based on the hearings now in their sixth week.

Steven Kuney, who represents the states, continued his cross-examination of Gates, who first took the stand late Monday morning. Gates spent much of Tuesday morning complaining that the language of the states's proposal was vague and ambiguous. But Kuney repeatedly walked Gates through his arguments, and several times got Gates to concede that he was interpreting the language in the proposed remedies literally, rather than reasonably, as a court would likely do. In fact, at one point in his testimony Gates told the court that a section of the proposed remedies "could be read to ban Microsoft from competing in any product category. I know such a ban would be unreasonable, and yet that is what the language of Section 8 appears to provide for." Gates argued that the restrictions in the proposal would do things like prevent his company from quickly offering a patch for a critical security hole before two months had passed. Kuney scoffed at such claims, suggesting that no reasonable person would interpret the restrictions as forbidding emergency repairs for Windows users. Kuney turned to testimony from the original antitrust trial, which ran from 1998 to 2000, to impeach Gates as witness. For instance, Gates testified that Navigator was "supposedly" a threat to Microsoft's monopoly power in the market for desktop computer operating systems, suggesting that he did not believe that,